Optimizing Charitable Contributions

Click here to download the Glenmede Donor-Advised Fund PDF

 

SUMMARY

Glenmede Donor-Advised Fund (DAF) is a convenient solution for donors seeking to simplify the administration of their charitable contributions over time and maximize their tax benefits.

What is a donor-advised fund (DAF)?

A DAF is a philanthropic vehicle established at a public charity allowing donors to make a charitable contribution, receive an immediate tax deduction and recommend grants from the fund over time.

How the Glenmede DAF works

A DAF is like a charitable savings account: a donor contributes assets to the fund and recommends grants to qualified charities when ready.

 

1:   Donor opens the DAF and makes an irrevocable contribution.

2:   Donor receives tax deduction for the contribution year.

3:   Donor names the fund, current and successor advisors, and selects investment options.

4:   Contributions can grow tax-free in DAF until granted.

5:   Grants from the fund can be made at any time to eligible charities.

Advantages

Flexibility

Donors can contribute a wide variety of assets: cash, public and private securities, real estate, restricted stock and more.

Minimal Cost

DAF can be established quickly and at minimal cost.

Tax Efficiency

• Donors may be able to take an immediate tax deduction, while DAF assets may continue to grow tax-free.
• DAF—sponsored by a public charity—qualifies for most-favorable tax deductions.
• Bunching multi-year contributions in one year can allow full tax benefits by creating a deduction large enough to itemize under current tax law.
• Contributions of appreciated assets held longer than one year generally qualify for deduction at fair market value.

Privacy

Grants can be made anonymously.

Legacy

Donors can establish a legacy by designating a DAF as beneficiary of an estate plan and naming successor advisors. They can also designate charitable beneficiaries to receive grant distributions after the donor’s lifetime.

Simplified Investing

Donors can select from managed portfolios matching their objectives

Coordination

DAF can complement other charitable vehicles, such as private foundations, and receive funding from charitable lead and charitable remainder trusts

DONORS SHOULD CONSIDER A DAF UNDER THESE CIRCUMSTANCES:

• Owning appreciated assets or having a large increase in income for the contribution year

• Terminating or supplementing a private foundation

• Making continuing charitable contributions over time and needing flexibility for a spouse or family members to contribute and select charitable recipients

• Selling a business or property

• Combining multi-year contributions in a single year to take full advantage of charitable deductions

Benefits of using a Glenmede DAF

Access

Online access to DAF activities and tools to facilitate grantmaking

Information

Access to online research on charities and additional non-profit sector resources

Advice

Administration/advice for a full suite of charitable vehicles and legacy planning

Assistance

Technical advice and assistance with managing complex charitable relationships

Investments

• Access to managed portfolios with risk profiles matching donor objectives
• Access to customized portfolios for DAF accounts with $5 million in assets

Convenience

Glenmede facilitates DAF set-up and funding, and provides reporting and support within a broader wealth management relationship.

Important details on Glenmede DAF program

• The minimum initial contribution is $25,000, and $5,000 for subsequent contributions.

• The Glenmede DAF is a partnership with National Philanthropic Trust (NPT), a tax-exempt public charity that maintains exclusive legal control over contributed assets and manages the administration of all donor-advised fund assets.

• The value of the DAF account will fluctuate with market performance.

Glenmede Donor-Advised Fund is offered under an agreement between The Glenmede Trust Company, N.A.  and National Philanthropic Trust (“NPT”), a tax-exempt public charity that maintains exclusive legal control over contributed assets. This material is intended to be a review of issues or topics of possible interest to Glenmede Trust Company clients and friends and it is not personalized investment, estate planning, tax or legal advice. Advice is provided in light of a client’s applicable circumstances and may differ substantially from this presentation. This material may contain Glenmede’s opinions, which may change without notice after date of publication. Information gathered from third-party sources is assumed reliable but is not guaranteed. This publication may not be used as legal or tax advice.